Skipping SIP For Just One Year Can Cost You Rs 22 Lakh; Here’s How

Smart investing plays a key role in achieving long-term financial goals. A long-term wealth accumulation strategy often involves consistency and discipline. Mutual funds are gaining popularity among Indian investors because they allow more flexibility in terms of the investment amount and the tenure. Mutual fund systematic investment plans (SIPs) offer investors an opportunity to build wealth with small contributions regularly, typically every month.

For building a sizeable corpus for long-term goals, investors need to regularly contribute smaller, fixed amounts, typically monthly or quarterly, into mutual fund schemes. In times of uncertainty, whether due to job loss, medical emergencies, sudden expenses, or market fluctuations, many investors think

about pausing their SIPs.

Although it may seem like a practical short-term decision, doing so can lead to significant financial losses in the long run.

Skipping your SIP for a year is not just about missing a few instalments. It slows down the wealth-building process driven by compounding. When you restart, the market has already advanced, and your investments have less time to grow. This lost time creates a gap in your financial journey that can be hard to make up later.

A Pause Can Shrink Future Gains

The real strength of SIPs emerges over a longer tenure, as compounding helps investments grow faster in later years. Pausing midway can reduce this growth potential, significantly impacting your overall returns.

For example, a monthly SIP of Rs 10,000 for 25 years can grow into an estimated Rs 1.89 crore corpus at an assumed return of 12% per annum. However, a simple one-year gap can affect the overall corpus significantly. For instance, the same SIP will grow into a corpus of Rs 1.67 crore in 24 years. So, even a one-year shorter duration will reduce your overall corpus by Rs 22 lakh.

When Pause Becomes Patterns

Stopping a SIP can also break your investing discipline. Restarting often gets delayed as you rethink timing and goals, and what was meant to be a short break can easily become a long one.

A Choice That Feels Safe Now May Cost You Later

Pausing your SIP may seem harmless, because there’s no immediate pressure on your finances and the extra cash can feel reassuring. But the real impact shows up later, when the money that should have been invested is no longer there to support your long-term goals.

Why More Money Later Can’t Replace Lost Time

Many investors try to make up for a pause by investing more when they restart. While this sounds practical, compounding depends on time. Once that time is lost, it cannot be recovered, no matter how much you invest later.